Transforming HR into a Business Partner Mike Nxele, BDT/HCB mike.nxele@itu.int ITU Regional Workshop on “Competencies for Competitiveness' Cairo, 25-28 June 2007

Presentation Outline - HR Transformation Process - Key Business Partner Role of HR - New Challenges for HR - Future functions for HR - Perceptions of HR function - Conclusion

Statistics of HR Transformation 50% of organisations are in the middle of transforming their HR functions; 12% completed their HR transformations in the past year; Another 10% intend to begin the process in the next year. (Global HR Transformation Study, 2006, Mercer Human Resource Consulting)

HR Transformation Process of Recreating the HR function so as to enhance HR contribution to the business It involves a shift from the internal operations (transactional, inward) activities to a more direct role in corporate performance. Over the years role has been evolving, but within its HR (Personnel) box. Current transformation is breaking outside the box Now HR transformation deals with issues of Organisational Renewal, Change Management, business success, culture, behavioral change.

Transformation Wave 5-10 years ago: focused on improving technology and service delivery Time of Intranet, BPR, Restructuring/Rightsizing, Outsourcing This was the role of HR as a Consultant. Role did not transform the HR function into a business partner Now HR is being called up to deliver

What is HR as a business partner?? Must manage people ( Talent Management) Identify skills required within people in the organisation (Competency Profiling) Develop and supply quality executives( Leadership Development) Motivate and retain key players (Human Capital) so that they perform at their best Maintaining and improving company’s image Be involved at the sharp end of the business

Understanding the business Being concerned with the bottom line and impact of any decision on profitability The business environment (SWOT, competitor moves, market share, etc.) Understanding customers, customer profiles and their needs.

Four Key Roles of HR as a Business Partner HR as knowledge facilitator HR as change manager HR as relationship builder HR as Human Capital steward

HR as Knowledge Facilitator Participate in formulation of list of organisational and individual competencies linked to the corporate goals or strategies Facilitate access to information and has key role in information dissemination Identifying,nurturing, developing and untapping human talent.

HR as Change Manager HR as principal change agent Identifying behaviors and values that support change in line with new corporate goals and challenges Implementing new rules and procedures that reinforce and reward desired behaviors Implementing effective communication strategies to influence acceptance of change, and build a new culture in the organisation

HR as Relationship builder Both internal and external customers Supply Chain Management (in telecoms this is important for maintenance of brand image and brand integrity… Managing diversity

HR as Human Capital Steward Career Management Facilitate progression of staff based on their competencies, desires and contribution to organisational goals Building competencies in anticipation of future needs

PRIORITIES FOR HR EXECUTIVES OVER THE NEXT TWO YEARS(2003) Role of SHR Communication Make sure that your line managers think effective communication. Succession Planning Build your leadership pipeline. Diversity Move your organization beyond “intellectual diversity.” Measurement Focus on meaningful measures. PRIORITIES FOR HR EXECUTIVES OVER THE NEXT TWO YEARS(2003) Learning Ensure your organizational capacity exceeds the rate of change. Leadership Redefine leadership, and demand it of every employee. Employment Branding Create a brand for your organization in the labour market. Employee Engagement Capture a bigger portion of the employee mindshare.

New challenges for HR Results of 2006 Mer…. Global transformation Study Challenge ► Acquiring key talent/back of available talent ► A.. cultural and behavioral change in the organisation ► Building Leadership capa ► Retaining key talent ► Increasing l… Management responsibility ► Succession Planning Response 43% 40% 40% 38% 26% 24%

New challenges for HR Challenge Response ► Increasing workforce productivity ► Constraints on Headcount. ► Encouraging organisational innovation ► Implementing people changes resulting from changes due to operational performance ► Measuring human capital contribution to business performance ►Lack of consensus around the organisations strategy/direction ► Reducing overall human capital costs ► Resourcing and managing HR issues in a new geographies for the company Response 22% 20% 18% 17% 16% 15%

New challenges for HR Challenge Response ► Managing human capital during and after an acquisition or merger ► Workforce planning ► Increasing the return on investment in remuneration ► Coping with aging workforce Response 15% 14% 12%

Observation The major challenges for HR are evidently linked to transformational issues and human capital strategy Matters of processes, technology and administration are becoming less and less of a challenge to HR The verdict?.... HR is moving up the business value chain

What HR functions will matter in the future? Human Capital strategy Talent Management Change Management Leadership Development Organisation Design Organisation Development Operational excellence within the HR Function Workforce Planning Succession Planning Industrial Relations Risk Management Today 40% 49% 42% 21% 35% 46% 31% 24% 32% 18% 2-3 yrs 64% 55% 38% 52% 27% 19% 17% ↑ ↓

Is HR being finally recognised Global perceptions of the role of HR are also changing 67% of respondents now view HR as a Strategic Partner, participating in strategic discussions and decisions 67% of HR Executives are reporting direct to the CEO, up from 54% in 2003 59% discuss strategic issues with the board, issues such as Talent Management, Succession Planning, etc.

Conclusion The future of HR is bright Value lies in contributing to business success Strategic value of HR is in being a business partner It is up to HR professionals to seize this opportunity and prove their worth and value in organisations.

Conclusion Thank You.